The Federal Reserve lowered the key interest rate to 1.5 percent Wednesday, in an emergency rate cut to help stabilize the U.S. economy. When the Fed cuts rates, it means consumers may be able to get a lower rate passed onto them when they obtain an auto loan for their car purchase.
As the Fed reduced interest rates by half a point, six other major central banks from around the world also slashed interest rates Wednesday in an attempt to prevent a growing financial crisis from becoming a global economic meltdown, reports the AP and MSNBC.
In Europe, the Bank of England slashed its rate by half a point to 4.5 percent and the European Central Bank also cut its rate by half a point to 3.75 percent.
Other countries whose central banks also cut rates were China, Canada, Sweden and Switzerland.
"The recent intensification of the financial crisis has augmented the downside risks to growth and thus has diminished further the upside risks to price stability," the Fed said.
The Fed reportedly may cut rates again at its regularly scheduled meeting on Oct. 29.